Finward Bancorp Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Note 7 - Loans Receivable (Tables)

Note 7 - Loans Receivable (Tables)

9 Months Ended

Sep. 30, 2023

Schedule of Accounts, Notes, Loans and Financing Receivable [Table Text Block]

(Dollars in thousands)
	September 30, 2023			December 31, 2022
Loans secured by real estate:
Residential real estate	$	487,659		$	484,595
Home equity		47,339			38,978
Commercial real estate		498,513			486,431
Construction and land development		121,547			108,926
Multifamily		225,469			251,014
Total loans secured by real estate		1,380,527			1,369,944
Commercial business		98,723			93,278
Consumer		747			918
Manufactured homes		31,661			34,882
Government		10,021			9,549
Loans receivable		1,521,679			1,508,571
Add (less):
Net deferred loan origination costs		4,070			5,083
Undisbursed loan funds		(89	)		(23	)
Loans receivable, net of deferred fees and costs	$	1,525,660		$	1,513,631

Financing Receivable, Past Due [Table Text Block]

(Dollars in thousands)	30-59 Days Past Due		60-89 Days Past Due		Greater Than 90 Days Past Due and Accruing		Total Past Due and Accruing		Current		Accruing Loans		Non-accrual Loans		Total Loans Receivable
September 30, 2023
Residential real estate	$	5,419	$	1,380	$	11	$	6,810	$	475,035	$	481,845	$	5,814	$	487,659
Home equity		216		10		-		226		46,500		46,726		613		47,339
Commercial real estate		1,583		527		222		2,332		495,183		497,515		998		498,513
Construction and land development		-		-		-		-		121,547		121,547		-		121,547
Multifamily		3,351		308		-		3,659		220,862		224,521		948		225,469
Commercial business		701		30		-		731		96,527		97,258		1,465		98,723
Consumer		-		-		-		-		745		745		2		747
Manufactured homes		485		246		-		731		30,930		31,661		-		31,661
Government		-		-		-		-		10,021		10,021		-		10,021
Total	$	11,755	$	2,501	$	233	$	14,489	$	1,497,350	$	1,511,839	$	9,840	$	1,521,679

December 31, 2022
Residential real estate	$	3,758	$	2,520	$	166	$	6,444	$	472,804	$	479,248	$	5,347	$	484,595
Home equity		315		42		-		357		38,027		38,384		594		38,978
Commercial real estate		1,399		150		-		1,549		481,640		483,189		3,242		486,431
Construction and land development		2,673		-		-		2,673		106,253		108,926		-		108,926
Multifamily		1,724		616		-		2,340		241,610		243,950		7,064		251,014
Commercial business		1,775		-		-		1,775		89,622		91,397		1,881		93,278
Consumer		3		-		-		3		915		918		-		918
Manufactured homes		601		256		82		939		33,943		34,882		-		34,882
Government		-		-		-		-		9,549		9,549		-		9,549
Total	$	12,248	$	3,584	$	248	$	16,080	$	1,474,363	$	1,490,443	$	18,128	$	1,508,571

Financing Receivable Credit Quality Indicators [Table Text Block]

September 30, 2023	2023			2022			2021		2020			2019			Prior			Revolving		Revolving Converted to Term		Total
Total Loans Receivable	$	120,990		$	327,676		$	329,016	$	238,750		$	117,664		$	290,691		$	94,590	$	2,302	$	1,521,679
Total current period gross charge-off	$	(60	)	$	(110	)	$	-	$	(342	)	$	(11	)	$	(973	)	$	-	$	-		(1,496	)

Residential real estate
Pass (1-6)	$	17,958		$	94,369		$	104,146	$	116,629		$	24,264		$	119,977		$	2,038	$	-	$	479,381
Special Mention (7)		-			-			153		107			303			1,371			-		-		1,934
Substandard (8)		-			966			154		488			457			4,279			-		-		6,344
Total	$	17,958		$	95,335		$	104,453	$	117,224		$	25,024		$	125,627		$	2,038	$	-	$	487,659
Current period gross charge-off		-			-			-		-			-			-			-		-		-

Home equity
Pass (1-6)	$	95		$	116		$	104	$	16		$	68		$	2,132		$	43,337	$	665	$	46,533
Special Mention (7)		-			-			-		-			-			67			114		-		181
Substandard (8)		-			167			-		-			-			154			304		-		625
Total	$	95		$	283		$	104	$	16		$	68		$	2,353		$	43,755	$	665	$	47,339
Current period gross charge-off		-			-			-		-			-			-			-		-		-

Commercial real estate
Pass (1-6)	$	47,346		$	121,142		$	93,017	$	56,483		$	56,482		$	112,834		$	2,882	$	-	$	490,186
Special Mention (7)		-			71			1,328		851			1,134			2,499			-		-		5,883
Substandard (8)		-			49			92		239			-			2,064			-		-		2,444
Total	$	47,346		$	121,262		$	94,437	$	57,573		$	57,616		$	117,397		$	2,882	$	-	$	498,513
Current period gross charge-off		-			-			-		-			-			(371	)		-		-		(371	)

*Construction and land development*
Pass (1-6)	$	32,930		$	37,460		$	20,838	$	2,018		$	8,640		$	497		$	11,501	$	1,637	$	115,521
Special Mention (7)		365			-			3,459		2,202			-			-			-		-		6,026
Total	$	33,295		$	37,460		$	24,297	$	4,220		$	8,640		$	497		$	11,501	$	1,637	$	121,547
Current period gross charge-off		-			-			-		-			-			-			-		-		-

Multifamily
Pass (1-6)	$	9,588		$	53,484		$	81,284	$	43,521		$	14,303		$	21,496		$	179	$	-	$	223,855
Special Mention (7)		-			-			-		-			-			130			-		-		130
Substandard (8)		-			-			-		457			-			1,027			-		-		1,484
Total	$	9,588		$	53,484		$	81,284	$	43,978		$	14,303		$	22,653		$	179	$	-	$	225,469
Current period gross charge-off		-			-			-		-			-			-			-		-		-

Commercial business
Pass (1-6)	$	10,383		$	15,992		$	9,910	$	6,227		$	6,438		$	13,398		$	34,235	$	-	$	96,583
Special Mention (7)		33			-			63		-			134			446			-		-		676
Substandard (8)		-			-			199		99			-			1,166			-		-		1,464
Total	$	10,416		$	15,992		$	10,172	$	6,326		$	6,572		$	15,010		$	34,235	$	-	$	98,723
Current period gross charge-off		-			(110	)		-		(342	)		(11	)		(602	)		-		-		(1,065	)

Consumer
Pass (1-6)	$	402		$	87		$	127	$	9		$	19		$	101		$	-	$	-	$	745
Substandard (8)		-			-			-		2			-			-			-		-		2
Total	$	402		$	87		$	127	$	11		$	19		$	101		$	-	$	-	$	747
Current period gross charge-off		(60	)		-			-		-			-			-			-		-		(60	)

Manufactured homes
Pass (1-6)	$	-		$	1,958		$	12,709	$	9,402		$	5,422		$	2,170		$	-	$	-	$	31,661
Total	$	-		$	1,958		$	12,709	$	9,402		$	5,422		$	2,170		$	-	$	-	$	31,661
Current period gross charge-off		-			-			-		-			-			-			-		-		-

Government
Pass (1-6)	$	1,890		$	1,815		$	1,433	$	-		$	-		$	4,883		$	-	$	-	$	10,021
Total	$	1,890		$	1,815		$	1,433	$	-		$	-		$	4,883		$	-	$	-	$	10,021
Current period gross charge-off		-			-			-		-			-			-			-		-		-

	December 31, 2022
(Dollars in thousands)	1-6		7		8

Loan Segment	Pass		Special mention		Substandard		Total
Residential real estate	$	477,222	$	1,338	$	6,035	$	484,595
Home equity		37,981		385		612		38,978
Commercial real estate		474,055		4,955		7,421		486,431
Construction and land development		106,580		2,346		-		108,926
Multifamily		242,091		1,859		7,064		251,014
Commercial business		90,694		703		1,881		93,278
Consumer		918		-		-		918
Manufactured homes		34,882		-		-		34,882
Government		9,549		-		-		9,549
Total	$	1,473,972	$	11,586	$	23,013	$	1,508,571

Financing Receivable, Modified [Table Text Block]

	For the three months ended September 30, 2023
(Dollars in thousands)	Payment Delay		Term Extension		Interest Rate Reduction		Combination Term Extension and Interest Rate Reduction		% of Total Segment Financing Receivables
Home Equity	$	-	$	16	$	-	$	-		0.03	%
Total	$	-	$	16	$	-	$	-		0.00	%

	For the nine months ended September 30, 2023
(Dollars in thousands)	Payment Delay		Term Extension		Interest Rate Reduction		Combination Term Extension and Interest Rate Reduction		% of Total Segment Financing Receivables
Residential Real Estate	$	-	$	878	$	-	$	-		0.18	%
Home Equity	$	-	$	16	$	-	$	-		0.03	%
Total	$	-	$	894	$	-	$	-		0.06	%

(Dollars in thousands)	Current		30-59 Days Past Due		60-89 Days Past Due		Greater Than 90 Days Past Due
Residential Real Estate	$	878	$	-	$	-	$	-
Home Equity	$	16	$	-	$	-	$	-
Total	$	894	$	-	$	-	$	-

Schedule of Accretable Yield from Financing Receivables [Table Text Block]

(dollars in thousands)	Total
2022	$	176
2023		244

(dollars in thousands)	Total
2022	$	723
2023		486

(dollars in thousands)	Total
Remainder 2023		194
2024		768
2025		689
2026		466
2027 and thereafter		3,679
Total	$	5,796

Financing Receivable, Allowance for Credit Loss [Table Text Block]

(Dollars in thousands)	Beginning Balance		Adoption of ASC 326		PCD Gross-up		Charge-offs			Recoveries		Provisions			Ending Balance

Allowance for credit losses:
Residential real estate	$	4,854	$	-	$	-	$	-		$	11	$	(154	)	$	4,711
Home equity		680		-		-		-			-		41			721
Commercial real estate		7,031		-		-		1			1		426			7,459
Construction and land development		3,599		-		-		-			-		(195	)		3,404
Multifamily		1,020		-		-		-			45		(115	)		950
Commercial business		2,050		-		-		(622	)		18		463			1,909
Consumer		57		-		-		(20	)		1		18			56
Manufactured homes		166		-		-		-			-		(12	)		154
Government		50		-		-		-			-		16			66
Total	$	19,507	$	-	$	-	$	(641	)	$	76	$	488		$	19,430

Allowance for loan losses:
Residential real estate	$	2,756	$	-	$	-	$	-		$	8	$	246		$	3,010
Home equity		373		-		-		-			-		22			395
Commercial real estate		5,527		-		-		-			-		(27	)		5,500
Construction and land development		1,744		-		-		-			-		(229	)		1,515
Multifamily		1,128		-		-		-			-		108			1,236
Commercial business		1,808		-		-		(57	)		50		(100	)		1,701
Consumer		70		-		-		(13	)		4		(20	)		41
Manufactured homes		-		-		-		-			-		-			-
Government		-		-		-		-			-		-			-
Total	$	13,406	$	-	$	-	$	(70	)	$	62	$	-		$	13,398

Allowance for credit losses:
Residential real estate	$	3,021	$	1,688	$	535	$	-		$	74	$	(607	)	$	4,711
Home equity		410		99		29		-			-		183			721
Commercial real estate		5,784		1,003		443		(371	)		2		598			7,459
Construction and land development		1,253		1,735		-		-			-		416			3,404
Multifamily		1,007		141		-		-			131		(329	)		950
Commercial business		1,365		320		5		(1,065	)		166		1,118			1,909
Consumer		57		5		17		(60	)		7		30			56
Manufactured homes		-		112		-		-			-		42			154
Government		-		55		-		-			-		11			66
Total	$	12,897	$	5,158	$	1,029	$	(1,496	)	$	380	$	1,462		$	19,430

Allowance for loan losses:
Residential real estate	$	2,480	$	-	$	-	$	-		$	58	$	472		$	3,010
Home equity		357		-		-		-			-		38			395
Commercial real estate		5,515		-		-		-			-		(15	)		5,500
Construction and land development		2,119		-		-		-			-		(604	)		1,515
Multifamily		848		-		-		-			-		388			1,236
Commercial business		2,009		-		-		(57	)		88		(339	)		1,701
Consumer		15		-		-		(50	)		16		60			41
Manufactured homes		-		-		-		-			-		-			-
Government		-		-		-		-			-		-			-
Total	$	13,343	$	-	$	-	$	(107	)	$	162	$	-		$	13,398

Schedule of Collateral Dependent Loans [Table Text Block]

(Dollars in thousands)	September 30, 2023
Commercial	Real Estate		Accounts Receivable		Other		Total		ACL Allocation
Commercial real estate	$	2,441	$	-	$	-	$	2,441	$	61
Multifamily		1,483		-		-		1,483		-
Commercial business		-		1,612		298		1,910		493
	$	3,924	$	1,612	$	298	$	5,834	$	554

Financing Receivable, Nonaccrual [Table Text Block]

As of September 30, 2023	Nonaccrual with No Allowance for Credit Loss		Nonaccrual		Loans Past Due over 90 Days Still Accruing
Residential real estate	$	1,065	$	4,749	$	11
Home equity		183		430		-
Commercial real estate		759		239		222
Construction and land development		-		-		-
Multifamily		948		-		-
Commercial business		-		1,465		-
Consumer		-		2		-
Manufactured homes		-		-		-
Government		-		-		-
Total	$	2,955	$	6,885	$	233

Financing Receivable, Impairment Evaluation [Table Text Block]

	Ending Balances

(Dollars in thousands)	Individually evaluated for impairment reserves		Collectively evaluated for impairment reserves		Loan receivables		Individually evaluated for impairment		Purchased credit impaired individually evaluated for impairment		Collectively evaluated for impairment

The Bancorp's allowance for loan losses impairment evaluation and loan receivables are summarized below at December 31, 2022:

Residential real estate	$	24	$	2,997	$	484,595	$	1,518	$	988	$	482,089
Home equity		3		407		38,978		294		125		38,559
Commercial real estate		13		5,771		486,431		2,392		2,935		481,104
Construction and land development		-		1,253		108,926		-		-		108,926
Multifamily		-		1,007		251,014		6,739		382		243,893
Commercial business		297		1,068		93,278		1,758		953		90,567
Consumer		-		57		918		-		17		901
Manufactured homes		-		-		34,882		-		-		34,882
Government		-		-		9,549		-		-		9,549
Total	$	337	$	12,560	$	1,508,571	$	12,701	$	5,400	$	1,490,470

Impaired Financing Receivables [Table Text Block]

							For the nine months ended				For the three months ended
	As of December 31, 2022						September 30, 2022				September 30, 2022
(Dollars in thousands)	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
Residential real estate	$	1,683	$	3,017	$	-	$	2,596	$	206	$	2,563	$	51
Home equity		262		275		-		216		14		178		1
Commercial real estate		765		765		-		2,932		196		3,677		(24	)
Construction & land development		-		-		-		430		13		400		13
Multifamily		556		647		-		2,454		86		2,872		24
Farmland		-		-		-		-		-		-		-
Commercial business		1,205		1,324		-		1,137		79		1,048		3
Consumer		-		-		-		15		1		20		1
Manufactured homes		-		-		-		-		-		-		-
Government		-		-		-		-		-		-		-
														-
With an allowance recorded:														-
Residential real estate	$	88	$	88	$	17	$	179	$	5	$	272	$	(4	)
Home equity		22		22		4		21		1		21		-
Commercial real estate		835		835		386		844		-		846		-
Construction & land development		-		-		-		-		-		-		-
Multifamily		-		-		-		-		-		-		-
Farmland		-		-		-		-		-		-		-
Commercial business		392		392		277		332		14		311		(2	)
Consumer		-		-		-		-		-		-		-
Manufactured homes		-		-		-		-		-		-		-
Government		-		-		-		-		-		-		-

Total:
Residential real estate	$	1,771	$	3,105	$	17	$	2,775	$	211	$	2,835	$	47
Home equity	$	284	$	297	$	4	$	237	$	15	$	199	$	1
Commercial real estate	$	1,600	$	1,600	$	386	$	3,776	$	196	$	4,523	$	(24	)
Construction & land development	$	-	$	-	$	-	$	430	$	13	$	400	$	13
Multifamily	$	556	$	647	$	-	$	2,454	$	86	$	2,872	$	24
Farmland	$	-	$	-	$	-	$	-	$	-	$	-	$	-
Commercial business	$	1,597	$	1,716	$	277	$	1,469	$	93	$	1,359	$	1
Consumer	$	-	$	-	$	-	$	15	$	1	$	20	$	1
Manufactured homes	$	-	$	-	$	-	$	-	$	-	$	-	$	-
Government	$	-	$	-	$	-	$	-	$	-	$	-	$	-

Schedule of Changes in Liability for Credit Loss on Unfunded Commitments [Table Text Block]

	Three months ended,
	September 30,
(Dollars in thousands)	2023
Balance, beginning of period	$	3,136
Provision (recovery of provision)		(244	)
Balance, end of period	$	2,892

	Nine months ended,
	September 30,
(Dollars in thousands)	2023
Balance, beginning of period	$	-
Adoption of ASC 326		3,108
Provision (recovery of provision)		(216	)
Balance, end of period	$	2,892